Local News

Petersburg council mulls over land purchase

Petersburg’s City Council plans to meet again this week to try and come to agreement on funding the purchase of industrial waterfront land in Scow Bay. There was some support Monday night among the council for buying the land using a mix of local funding. However some council members wanted to seek state funding instead.

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Several local residents Monday urged the council to find a way to buy the land. Harbor board member Jeff Pfundt stressed the importance of deep water access for the fishing fleet. “This deep water port that we could have with Reid’s property is an integral part to our long-term future. I just ask you guys to keep working at it,” Pfundt said.

The over five acres of tidelands and uplands in Scow Bay is owned by the Reid family. They’re asking one point four million dollars and the city is trying to negotiate a lower price. The land is currently used for gear storage and a warehouse. It could continue to serve that role, or be used for vessel servicing or loading.

Council members mulled over five options offered by city staff for funding the purchase. The choices range from changes and increases to sales tax, paying back a bond with property tax, using a combination of city money from various funds, or seeking the money from the state legislature in the upcoming year.

City manager Steve Giesbrecht explained option three which would use a mix of city money. “Option three is taking basically using all of the property development fund or most of it, 250-thousand, 200-thousand from the economic fund, 200-thousand directly out of the general fund, leaving a remainder of up to 750-thousand, based on the price of what’s paid for the property. That would have to be financed in some fashion,” Giesbrecht said.

Several council members liked that approach. Councilor Rick Braun said he’d liked that option because it spreads the pain around. “The town as a whole will benefit from this project but I think everybody needs to pay a little bit and I think this spreads it out and the people who will benefit the most, the fishermen, it’s gonna cost them too and I think if we don’t have something like that as a funding option I don’t think the voters will approve it,” Braun said.

The council has been looking at changes in sales tax law to bring in more money and help pay for the purchase. One of the more popular ideas has been raising the sales tax cap, currently at 12-hundred dollars. Sales above 12-hundred do not bring in any additional sales tax revenue. But councilor Don Koenigs thought increasing that amount could fund operation of the property. “And that to me could be the source of revenue to sustain this operation. Personally that’s how I see this coming down, the fishermen themselves, the boat users are then paying their way in that light and if they’re willing to vote for that, the public can get behind that, then we have a revenue stream to sustain it,” Koenigs said. He agreed other city funds could help pay for the purchase but did not want to seek state money for the land.

Meanwhile, councilor Nancy Strand was only interested in seeking a state grant. “I don’t think the city can afford another acquisition at this time, especially in this amount and especially with the two million, 2.2 million dollar overrun in the harbor, in the north harbor, which has to be replaced or its gonna blow away,” Strand said.

The city is using state grant money to replace North Harbor. The latest estimate puts the price tag for that work more than two million dollars above the available funding. The harbor board plans to look at ways to reduce the cost of that project. Other state funds will pay for upgrades at the crane dock and a new drive down dock, which will be used for loading and servicing vessels.

City finance director Jody Tow reminded the council about local funding already set aside for projects in the harbor department. “In the fiscal year 13 budget they budgeted to transfer 820-thousand dollars to the north harbor replacement project and they’ve reserved 200-thousand dollars for the crane dock project which is a million dollar project,” Tow said. “So I guess my question to the council is we have the commercial drive down dock, we have the north harbor we have the crane dock, what’s gonna happen when there’s cost overruns? How are we gonna pay for that?”

The council made no final decision on the funding Monday but agreed to hold another meeting. Councilors did vote for an increase in the sales tax cap from 12-hundred dollars to 17-hundred dollars. That issue will go on the October ballot if the council gives two more approvals this month. Two fisherman on the council, Mark and John Jensen, were not at Monday’s meeting.

The council scheduled a special meeting for Friday at 3 p.m. to address funding for the Reid property as well as second reading of an increase to the sales tax cap.

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